Managers May Be Motivated to Revalue Assets Where There Are

Managers may be motivated to revalue assets where there are common forms of debt covenants in place because:

A) It loosens the covenant and allows the business to borrow more.
B) Revaluing assets provides more relevant information for debt-holders to use when making decisions.
C) Revaluing assets provides greater cash flows out of which to repay debt.
D) Revaluing assets provides more relevant information for debt-holders to use when making decisions and provides greater cash flows out of which to repay debt.